Magazine article Independent Banker

Keeping Boxes Safe

Magazine article Independent Banker

Keeping Boxes Safe

Article excerpt

Make a checklist to avoid potential Y2K liabilities for customers' safe deposit boxes

For most of your customers, using a safe deposit box has always been a simple task that typically goes like this: You rent the box, stuff it full of valuables, memorabilia and important documents and then forget about it.

But Y2K will change this carefree attitude. Many consumers are planning to store large sums of money in their safety deposit boxes to protect against major computer failures. In discouraging customers from keeping large amounts of cash at home, some bankers have been telling people to store their money in a safe deposit box until after Y2K blows over.

Now, after possibly giving customers this advice, think about this possible scenario: On Monday morning, Jan. 3, 2000, you open your bank's vault and find a hole cut through the ceiling. All your safe deposit boxes have been opened, and the contents of every renter's safe deposit box are gone.

If you told your customers that their money would be safe in their deposit box, you may have given them a verbal guarantee. Your advice may have opened your bank to unexpected legal liability!

CREATE A CHECKLIST

Unfortunately, this scenario may not be your only Y2K worry for your safe deposit operations. Because of many potential unknowns, banks are looking hard at their safe deposit box operations for ways to minimize their potential Y2K risks. Take a look at the following checklist to help your Y2K readiness.

1. Address all safe deposit security, insurance, forms, equipment, computer software or box access issues with your Y2K compliance officer.

2. Make sure your safe deposit lease protects you if your vault door does not open or if the door must be closed in a Y2K emergency.

3. Have a blank line on your rental agreement to type in the year 2000.

4. Your lease should state clearly that no insurance is provided on a renter's box contents. …

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